Posted August 26 2014 - 04:14 AM
I've read this thread with interest--and I signed up here just to join the conversation and perhaps add something that might be of interest.Huddler approached me about my forum of the time (I've since sold it). I think it was in 2011, maybe 2010. The company was actually doing the equivalent of cold-calling in those days...sending out e-mail inquiries to forums in which it was interested. As it happened, I had been interested in getting out from under the burden of running and growing my forum while holding down a full-time job or two on the side, so I entertained Huddler's advances. As it happened, members of the Huddler team--one of the Gill brothers and an associate named Alejandro--were going to be in my town, so we arranged a meeting.Prior to the meeting, Huddler told me about its business model. Essentially the company was most interested in converting proven forums to its platform, running the forums from its servers (leased, I suppose), heavily monetizing the forums, and keeping the owner and perhaps any associates on as admins to keep the community alive. Huddler examined the forum's financials and promised, after conversion, a baseline monthly payment equal to the average ad revenue that came in before the conversion. After the conversion, in addition to the baseline payment, Huddler would split the advertising revenue 60/40 with the owner. Huddler kept 60.Huddler's rep trotted out the bar graphs and charts of expected community and revenue gain after conversion. I took all of these with a huge grain of salt. In fact, having been in the software industry myself for about 20 years, I took everything from Huddler with a huge grain of salt. The grain of salt got even bigger after I took a close look at Huddler's software itself. It was excruciatingly slow, buggy, and user feedback from the forums so far converted was mostly negative. I could see my users screaming loudly after the conversion.Nevertheless, I was interested in getting out from under the forum, so I asked Huddler whether it would be interested in buying the forum outright. My thinking was twofold: first, I wasn't interested in hanging around for too long after the sale, as I was burned out, and second, I felt that if Huddler actually drank its own post-conversion kool-aid regarding future glory (which I doubted), then the company would surely be even more thrilled to actually *own* the forum than just to be a part owner.So I was surprised when Huddler said it would be willing to buy the forum outright. I was not so surprised, though, when its proposed purchase price, which was generous (VC money in young Silicon Valley hands means relatively little, I figured), was structured over two years. I was interested in an outright sale, with minimal involvement after a reasonable handover period (3 months). That's why I haggled a bit on the price. Careful guy that I am, I figured that, given Huddler's unknown track record and the current lousy condition of its software, I might only ever see the first year's money (initial payment). In other words, being the crusty former dot-com employee that I was, I had seen kool-aid of all flavors, and I was surprised by nothing. These young Huddler guys reminded me of so many before them, and they were cut from the same mold, so I trusted their business model barely a whit.Terms finally agreed-upon, I asked them to produce a sales contract, and my lawyer would look it over. The contract never came. Not too long afterwards, I learned that Alejandro, the bright young man from the Huddler team, had left the company. Bad sign, I thought. If things were so peachy at Huddler, why would he leave?In any case, that was pretty much the end of my involvement with Huddler. I've kept an eye on the forums under the company's control over the ensuing years, and I've been pleasantly surprised to see improved performance and a nice mobile implementation. But there were always a lot of red flags around Huddler, for me. That's why the only way I was willing to do business with them was as a seller, with them the full buyer. I didn't like the revenue-share model, not least because I had no idea whether the company would be in business for the long haul, and I suspected it wouldn't. Looks like I was right on that count. I guess you say in the crazy world of computers long enough, you learn a thing or two.